SEC investigating Merrill Lynch's subprime portfolio

The Securities and Exchange Commission initiated an investigation into matters related to Merrill Lynch's subprime mortgage portfolio, the bank said on Wednesday.

SEC staff began looking into the matter on October 24, the day the company reported its third quarter earnings, posting a loss of $2.3 billion on heavy losses due to write-downs related to subprime mortgages assets.

The disclosure was made in SEC filings. Merrill says that it is cooperating fully with the commission in the matter.